Each time an employee who works in the UK is paid they have to be assessed. When the employee is assessed they are assigned to one of the three categories below to establish their eligibility for the pension scheme.
Under the workplace pensions legislation, employees are categorised according to their age and earnings. Those earning over £10,000 per year (or the equivalent per pay period) and who are aged between 22 and state pension age must be automatically enrolled into a pension scheme. They become scheme members and start paying contributions unless they choose to opt out. Employers also have to pay contributions into their pensions on their behalf. These pension contributions have to be deducted from pay by the employer. Other employees can choose to join the scheme.